The best and not-so-best worlds: Looking at Maui’s hospital changeover, a year later

1 year after hospital transition – growing pains: A more nimble hospital system is still facing employee and doctor recruitment challenges

Colleen Uechi

Staff Writer

cuechi@mauinews.com

It’s been just over a year since Kaiser Permanente’s Maui Health System took over operations at Maui County’s three public hospitals — Maui Memorial Medical Center, Kula Hospital and Lanai Community Hospital. Maui Health System’s new CEO says it is trying to use Kaiser’s resources while trying to run a private community hospital. Employees, who have waited for a year for a new contract, say they feel like unwanted stepchildren. This photo of Maui Memorial’s emergency entrance was taken Thursday. -- The Maui News / MATTHEW THAYER photo

WAILUKU — The top official at Maui County’s three community hospitals believes one year under new management has given the formerly state-run facilities “the best of both worlds.”

“We are affiliated with Kaiser, but we are a private community hospital,” said Michael Rembis, chief executive officer of Maui Health System, the Kaiser Permanente affiliate that now runs Maui Memorial Medical Center, Kula Hospital and Lanai Community Hospital. “We try and do the best of both worlds. We’re utilizing some of the assets Kaiser’s providing — for purchasing power, some of the clinical expertise — to elevate the quality of care and do things better.”

But employees who’ve waited a year for a new contract say it’s created a situation where they feel like “unwanted stepchildren” — a problem of neither the state nor Kaiser. And, with contract negotiations still ongoing, they said morale is low and frustrations are high.

“There’s all kinds of great programs and all kinds of great things going on for the community, but I don’t think they realize the employees they hired from the start still are waiting for them to decide how they’re going to compensate us and take care of us,” said one hospital employee, who asked to remain anonymous out of concern for her job. “We do what we do regardless. But it’d sure be nice to have an idea.”

Employees said they were hopeful when Kaiser first came on board in July 2017. Lawmakers and state hospital officials were too; they’d spent years trying to find the state a private partner to run the three facilities, which were losing money under the quasi-public Hawaii Health Systems Corp. Kaiser had the resources, the reputation and the know-how, and in January 2016, the health care provider inked a 30-year contract with the state to run the hospitals. Gov. David Ige said at the time that the move would save the state $260 million over 10 years — though the state would still need to subsidize the hospitals initially.

So far, Rembis said, the hospitals have taken several steps toward improvement. In terms of patient care, he said there’s been no cases of ventilator-associated pneumonia — a common hospital infection — since last July, and he pointed to the creation of the Patient Care Experience Department, which focuses on visiting patients and their families daily and offering services such as pet therapy.

“That was happening before, but not with such structure and focus as it is right now,” Rembis said. “We’re really trying to share with everyone it’s important on a daily basis we talk to everybody, not just the patient, but the families.”

Maui Health System is also trying to build a more local workforce, Rembis said. Since November, the system has hired 72 new nursing graduates and decreased the number of traveling nurses from more than 200 to 80. The hospitals have filled more than 285 positions over the past year, and 220 of those hires have been from Maui.

“In my mind, there’s nothing more important than people who live here providing care to their friends and relatives,” Rembis said.

The Maui hospitals also are working with the University of Hawaii at Maui College to develop programs to train people for fields such as radiology and as certified nursing assistants. Filling vacancies helps the hospitals achieve their “No. 1 goal next to quality,” which is keeping patients on Maui, Rembis said. The Maui hospitals expect to bring in a full-time neurosurgeon by the end of the year and are working on bringing in another. The island’s lone neurosurgeon, Dr. Thomas Rogers, has been on call 24/7 for the past 20 years.

The hospitals also are trying to recruit more oncologists. While there are some on Maui, the island needs more, said Rembis, adding that he expected to have a full-time oncological surgeon on Maui by November.

A firm hired by Maui Health System to study physician need on Maui found that the island needs 100 more physicians over the next five to 10 years, Rembis said. So, the goal is to recruit 10 physicians every year by helping them find the best fit in the community — whether that means starting their own private practices or partnering with community doctors or organizations like Maui Medical Group.

Keeping patients on island will help Maui Health System wean off its reliance on state subsidies, Rembis said. For fiscal year 2017-18, state lawmakers set aside nearly $73 million for the transition, including $33.4 million for operations and $30.6 million for employee separation benefits. In fiscal year 2018-19, Maui Health System is getting $28.8 million for operations and $6 million for improvements.

“Our goal is to reduce cost and try to completely reduce or eliminate that subsidy within the timetable the state gave us or sooner,” Rembis said. “And the way to do that, I believe, is to reduce our costs but also to keep patients on Maui. Because if we keep patients on Maui, your revenues go up.”

Rembis said Kaiser also has the vendors and the purchasing power to help the hospitals get better deals in bulk and thus save money.

Joyce Tamori, chief financial officer for Maui Health System, said the state reported an operating loss of $60 million before subsidies, and that Maui Health System has been able to reduce the loss by more than 30 percent.

Uncertainty and frustration

But several employees, who asked to remain anonymous out of concern for their jobs, said the external improvements belie the internal realities for workers. They said nurses in some departments are being asked to take on additional duties when staffing is already stretched thin. Changes to the ordering system have left some floors short on supplies.

And, the push to hire dozens of new graduates has created unintended consequences. As longtime employees leave over frustrations with pay and the lack of a contract, inexperienced nurses have come in their places, forcing veteran nurses to juggle caring for their patients while training the new hires.

They said that, if they had to choose, they’d send their loved ones elsewhere for care.

“I think patient safety for me is an issue,” one nurse with 15 years of experience said. “Our management doesn’t seem to be concerned about the skill level that is leaving us and the lack of skill that is coming in. And I was new once, and I understand the process of learning, but there are so many people that are leaving and going elsewhere.”

For employees, it all comes back to contract negotiations between Maui Health System and the unions, which have been ongoing since the transition a year ago. Under the state system, employees were supposed to get a raise on July 1, 2017, but that didn’t happen because of the transition. Employees said waiting for a contract has created uncertainty and left them unprotected. They said they’re no longer being compensated for overtime at the previous rates, which has made people reluctant to fill in after hours and worsened issues with overstaffing.

“To celebrate the one-year anniversary, they gave us a T-shirt and some ice cream, when what we really want is a contract — a fair contract,” one nurse with more than 20 years of experience said.

And, the nurse said, it’s hard to hear how employees at Kaiser facilities who don’t work night shifts and holidays get paid at higher rates. For the employees, it’s hard to avoid making comparison to Kaiser facilities. They said that their paycheck comes from Kaiser; they’ve adopted Kaiser policies; and they’re considered internal applicants when applying for jobs at the Kaiser clinic. One nurse with 28 years of experience said that “we’re Kaiser employees when it’s convenient.”

“I feel like they know they can do this, because where else are we going to go?” one nurse with 10 years of experience said. “We brought this up and had meetings with management. But their biggest thing is, ‘We’re not a Kaiser hospital’ is what they keep telling us. So they don’t need to treat us like other Kaiser employees.”

It’s created something of a no man’s land for employees — they work for community hospitals that are no longer run by the state but also are not technically Kaiser.

” ‘Who do we belong to?’ is the question,” the nurse with 10 years of experience wondered. “Who’s on our side? Who do we go to for help?”

The Hawaii Government Employees Association still represents about 720 employees at the three hospitals.

In response to employee concerns, Executive Director Randy Perreira said: “HGEA is the advocate for our members, the Legislature plays a role as ‘watchdog’ as the state has, through legislation, the agreement in place to have Kaiser as the entity that now runs the hospital.

“Our goal once again is to reach an agreement that is fair and equitable, as well as an agreement that will provide our members the protection necessary to work on a safe, nonhostile environment,” Perreira said.

HGEA spokesperson Caroline Sluyter could not say when contract talks might be resolved, but she said that “it’s a new contract, so that could be one of the reasons it’s taking a little longer than we had hoped.”

‘Not a Kaiser hospital’

Rembis said there’s been a lot of confusion over Kaiser’s role with the community hospitals. He said that Maui Health System “stands on its own” with some support from Kaiser, but does not “blindly adapt everything Kaiser has.”

“We have the ability to take the best from Kaiser, but we can pick and choose,” he said. “We are not a Kaiser hospital, and as such, we don’t have all the Kaiser salaries and benefits. We don’t have the Kaiser policies. We are developing what is best for Maui in the Maui Health System.” Tara Cole, human resources director for Maui Health System, said that “our goal is to provide wages that are competitive with what is paid for similar work in our community and industry.

“Wages at Kaiser Permanente’s Hawaii Region have been established from a long history of negotiated collective bargaining agreements,” Cole said. “Wages do vary among entities or regions of Kaiser Permanente. Each union must bargain independently and are each impacted by many factors including the organization structure and financial capability.”

When asked whether it was true that new hires were getting paid at higher rates than longtime nurses, another concern of employees, Cole responded that the Maui Health System “applied a hiring strategy to attract more highly experienced nurses with a wage rate that is within the current pay range.

“The hospitals did not use this strategy prior to the transition and so there are nurses who may have had much experience at the time they were hired that were not treated the same way in the past,” Cole said. “Wages and pay practices are a mandatory subject of bargaining and so we are looking forward to addressing this through the achievement of a new agreement.”

Rembis said that negotiations have been slow “to the frustration of everybody,” but that both sides changed negotiators part way through and delays were nobody’s fault.

He said he hoped to have an update by the end of the month and that an agreement with the United Public Workers union that also represents some employees would likely come a few months after HGEA talks were resolved.

Avery Chumbley, chairman of the Hawaii Health Systems Corp. Maui Region Board, said he is “disappointed that it’s taken a year to get through these negotiations.”

Chumbley added that he’s heard the concerns about the differences in pay.

“I know it’s frustrating to them because they gave up, under the state system, a lot of benefits,” he said.

“The state benefits are greater than the private sector benefits. But the private sector has longevity and a sustainable security system. They gave something up, and they just need to be compensated at a fair market value.”

Chumbley acknowledged the early challenges that come with balancing Kaiser’s influence over the hospitals. But, overall, he’s optimistic.

“It’s been 12 months, and there’s a period of adjustment,” he said. “I do believe that Kaiser has had an influence on the Maui Health System operation. But have they monopolized? I don’t believe so. At least I hope that management and the Maui Health System board are standing up and saying, ‘This is a community hospital.’ “ (The newly formed Maui Health System board is different from the HHSC Maui Region board, which Chumbley said does not directly receive updates and reports from the hospitals.)

West and South Maui state Sen. Roz Baker, who also chairs the Commerce, Consumer Protection and Health Committee, said everyone was expecting “bumps in the road.”

“But I think for the long term, it is a boon to Maui in terms of getting more efficient and getting more services, being attentive to the community and not having to go the Legislature for everything,” Baker said, adding that “it could not have worked if it stayed in the state system.”

“Procurement is easier — there’s just a lot of things,” she said. “The private sector is more nimble.”

In terms of accountability, Baker added that Maui Health System has a board of directors and is “beholden to the community to make sure that they have happy, well paid” employees.

“You can’t run a hospital without them,” she said. “I just don’t believe that our nurses will not be well compensated. It might take them a little longer, but at the end I expect that they’re going to be appropriately compensated.”

The long haul

Baker said she’s taking the long view and believes the issues that have arisen are more growing pains than signs of systemic problems.

“I believe it will evolve into the kind of health care setting and health care provider that we want it to be,” she said. “There’s always room for improvement no matter what you do in the bargaining process or the operating room or the emergency room or the patient bedside. It’s just a dynamic situation.”

Chumbley said what he hopes to see moving forward “is their commitment to do as they promised to do in their proposal, which was to expand physician and specialty services, to create policies that limit out-migration to Oahu.”

Rembis said Maui Health System is “looking at creating a cancer center and inviting all the oncologists in the community, perhaps, to practice together in one location where chemotherapy can be provided as well.”

“That’s one of our goals for 2019,” he said. “I think right now our focus is, let’s take the great assets the state has leased to us, improve them . . . and then find some things like an oncology center that will be additive as well.”

The nurses said they’ve seen some positives. For example, Maui Memorial is now giving new mothers private rooms, provided they’re not at capacity, and allowing visitors to stay overnight. Maui Health System also has made efforts to show employee appreciation — offering free coffee in the mornings, recognizing workers with awards and expanding healthy offerings in the cafeteria.

However, employees said the changes are often more “aesthetic” than anything substantive and geared more toward the moneymaking departments. They worry the hospitals will continue to lose workers if contract issues persist.

“It just breaks my heart to see all these experienced nurses leaving because conditions are not good,” one nurse with 22 years of experience said. “I want it to get better. I have never been through a transition, but I feel like there’s a big disconnect between nurses and administration.” Another nurse with 27 years of experience said that she doesn’t want to make patients afraid to come to the hospitals, “because in all honesty, we’re busting our butts to maintain a positive attitude.

“I really try to not let it affect patient care,” the nurse said. “But I can’t sit there and say, ‘Aren’t you glad that Kaiser is here?’ “